China January-September per capita disposable income rises at fastest pace in two years

BEIJING (Reuters) - Per capita disposable income in China rose 7.5 percent in the first three quarters of 2017 from a year earlier, the fastest pace since the same period in 2015, data from the National Bureau of Statistics showed on Thursday.

Workers walk at the construction site of new Daxing Airport on the outskirts of Beijing, China October 16, 2017. REUTERS/Jason Lee

That compares with 7.3 percent growth in the first half of the year and 6.3 percent in the year-ago period.

The pick-up in income growth this year reverses a steady downward trend since the current dataset began being released in 2013 and is a positive sign for an economy that Beijing says needs a bigger contribution from consumers.

Chinese President Xi Jinping said on Wednesday at the opening of a key, twice-a-decade Communist Party congress that China should strengthen consumption as a foundation for economic development.

Urban incomes rose 6.6 percent in the first nine months of the year, while rural incomes increased 7.5 percent, with both picking up from growth over the first half of the year.

But there are still some signs of weakness in the consumer sector. Per capita spending growth slowed to 5.9 percent in the January-September period, the slowest pace on record.

Spending by city dwellers rose 4.5 percent, also the slowest pace on record and down significantly from 5.1 percent in the first half. Rural per capita spending picked up to 7.4 percent growth.

China’s economy grew 6.9 percent in the first three quarters of the year, with consumption contributing 64.5 percent of that growth, the statistics bureau said Thursday.

Despite years of government rhetoric on rebalancing the growth drivers, progress has been slow as investment is still a bigger part of the economy than household spending.

The ratio for household spending increased last year, but was still below 40 percent of the economy and is far below the global average of 58 percent.

Reporting by Elias Glenn; Editing by Jacqueline Wong